Auto-enrolment for pension schemes

  • Insight

28 March 2018

From 6 April 2018 the minimum auto-enrolment rates will increase.

The rates are expressed as a percentage of an eligible jobholder’s qualifying earnings.

The minimum rate for employers will increase from 1% to 2%. The minimum rate for employees will increase from 1% to 3%.

The qualifying earnings rate will also increase as follows:

  • The earnings trigger remains the same at £10,000
  • The lower limit of the ‘qualifying earnings’ band will increase to £6,032
  • The upper limit of the ‘qualifying earnings’ band will increase to £46,350

A “jobholder” is defined as a worker who meets the following criteria:

  • Working or ordinarily works in Great Britain under a contract
  • Aged at least 16 and under 75
  • Paid qualifying earnings

An “eligible jobholder” for auto-enrolment purposes is a jobholder who:

  • Is aged at least 22
  • Has not reached state pension age
  • Has qualifying earnings above the earnings trigger

Eligible jobholders do not include those who have opted out of the auto-enrolment process.

Following the government’s review of auto-enrolment in 2017, the Department for Work and Pensions has proposed to lower the age at which workers are automatically enrolled from 22 to 18 from the mid-2020s.

For further informations on pensions, contact